Despite 17% Boost in Exports, Brazil’s Trade Surplus Fell 14% in 2007

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Exporta Fácil, Brazil's Easy Export program from the Post Office Brazil's trade balance ended the year of 2007 with a surplus of US$ 40 billion. The result is 13.8% lower than the surplus for 2006, which was US$ 46.4 billion. In 2007, exports reached US$ 160.6 billion and imports totaled US$ 120.6 billion. The figures were disclosed this Wednesday, January 2, by Brazil's Ministry of Development, Industry and Foreign Trade.

Despite the lower surplus than in the previous year, in 2007 exports grew 16.6% over 2006 and imports, 32%. The month of December 2007 posted a surplus of US$ 3.6 billion, with US$ 14.2 billion in exports and US$ 10.6 billion in imports.

For Getúlio Vargas Foundation's (FGV) professor Rogério Sobreira, the Brazilian economy outlook for the new year is "very favorable".

In an interview to Radio Nacional he said that, at the moment, there is a series of positive conditions.

"Investments are growing strongly, the Growth Acceleration Plan (PAC), which tends to be preserved in spite of the CPMF [Temporary Contribution on Financial Transactions] not being renewed and the government's concern in investing in infrastructure, especially in energy are  quite positive factors."

Sobreira, however, expressed concern regarding uncertainties in the international market. "The foreign scenario is still not clear,  we don't know exactly the dimension of the  crisis we are facing today".

He noted that, although Brazil exports mostly to Europe and not to the United States, where is the focus of the crisis, Europe will also feel the crisis effects. "We don't know what these effects are, how long they are going to last and how big are they."

The economist also believes that the Brazil could feel safer had its economic performance been better in recent years. Sobreira mentioned as one of the hindrances for the Brazilian economy the Central Bank's conservative approach.

"If the monetary policy  had been a little more flexible,  we would probably have had a  bigger growth rate, without a bigger inflation. Maybe not in the level of the Chinese who have been growing at a 10% rate in recent years, but for sure bigger than what we have been achieving."

ABr

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